Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $ 0.02 For example, electricity costs are $1,100 per month plus $0.08 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $5.90 per car washed. Required: Prepare the company's planning budget for August. Answer is complete but not entirely correct. Lavage Rapide Planning Budget For the Month Ended August 31 Budgeted cars washed ✓ Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost Cost per Car per Month Washed $ 0.50 $ 1,100 $ 0.08 $ 0.30 $ 4,500 $0.20 $ 8,400 $ 2,200 $1,400 Total expense Net operating income $ $ 0x 0x 0X 0x 0x 0x 0x 0x 0x 0 0

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $ 0.02 For example, electricity costs are $1,100 per month plus $0.08 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $5.90 per car washed. Required: Prepare the company's planning budget for August. Answer is complete but not entirely correct. Lavage Rapide Planning Budget For the Month Ended August 31 Budgeted cars washed ✓ Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost Cost per Car per Month Washed $ 0.50 $ 1,100 $ 0.08 $ 0.30 $ 4,500 $0.20 $ 8,400 $ 2,200 $1,400 Total expense Net operating income $ $ 0x 0x 0X 0x 0x 0x 0x 0x 0x 0 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Lavage Rapide owns and operates a large automatic car wash facility near Montreal. The following table provides estimates concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses. $ 0.03 For example, electricity costs should be $1,000 per month plus $0.07 per car washed. The company expects to wash 8.300 cars in August and to collect an average of $6.20 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement Actual cars washed Revenue Expenses: For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost Cost per per Month Car Washed $ 0.70 $1,000 $ 0.07 $0.10 $.0.30 $ 4,300 $ 8,200 $2,100 $ 1,700 Administrative expenses Total expenses Het operating income 8,400 $53,560 6,310 1,551 1,070 7,150 8,200 2.300 1,849 28,430 $ 25,110
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Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $23.40 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers-particularly those located on remote ranches that require considerable travel time. The owner's daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below: Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (organization-sustaining costs and idle capacity costs) Activity Measure Square feet cleaned (00s) Miles driven Number of jobs None Activity for the Year 8,000 hundred square feet 407,500 miles 1,900…